Statutory Authority or Requirement For Assignee To Sue In Own Name

The common law prohibition against an assignee to sue in his or her own name to enforce an assigned obligation has been widely abolished by legislation.  Statutes in many jurisdictions enable an assignee to sue in his or her own name, provided the debtor does not have to face double liability.

An assignee of an account may sue on it in his or her own name though the assignor has an interest in it.  If the assignor has any interest in the account after the assignment, the assignee stands in the position of a trustee for the assignor.  An executor, administrator, trustee of an express trust, or a person expressly authorized by statute may sue without joining with him or her the person or persons for whose benefit the action is prosecuted.  An absolute assignment vesting in the assignee the apparent legal title to a chose in action is considered as being unaffected by a collateral contemporaneous agreement regarding the proceeds.  The assignee may sue in his or her own name as the real party in interest, even though the entire consideration for the assignment is set up to depend on the contingency of collection, or the assignee is to account to the assignor for the proceeds when collected.[i]

When a statute specifically designates the classes of choses in action upon which the assignee may bring suit in his or her own name, the right of the assignee to sue in his or her own name is limited to suits upon choses of the kind designated.  Moreover, in some jurisdictions, if there has been a full and complete assignment of rights under a contract, the assignee rather than the assignor, is the proper party to maintain the cause of action.  In other jurisdictions, a statute authorizing an assignee to sue in his or her own name is merely permissive, leaving the assignee at liberty to sue in the name of the original party to the contract.

[i] Castleman v. Redford, 61 Nev. 259 (Nev. 1942)


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